A Millennial Full of Hot AirMillennial2000,
I put up my analysis freely for anyone (long or short) to consider. Some shorts have respectfully done so, and I thank them for that. But you've never actually engaged with the analysis.
You call it misleading. Tell me why? Which assumption do you think is incorrect? There are shorts here who point to Cologuard. I think it's a fair criticism, and any long has to pay attention to CRH's volumes. I note that management has given us an estimate of volume for 2018 and I rely on this. Others have pointed to payor issues. I think those are fair too, and I try to capture that in my revenue/case estimate.
But your hot air doesn't actually address the question of how much money the business can make and what multiple you would pay to have access to that stream of cash flows.
Yes, the further CMS rate cut is not pleasant, but as I've shown, nor is it a disaster. Tell me where the analysis has an error, and I'd gladly consider it.
Millennial, tell me something, have you ever actually participated in a real business or owned an investment property? If someone told you that they would let you be a co-partner in a business at 10x free cash flow with slight leverage, would you say no? What about 6x, where CRHM currently trades adjusted for all the cuts? I assume that you'd wonder if the cash flows would remain stable. We can have a debate on that for sure. I've presented why I think cash flows, even with this payor cut, will stabilize. That's not being "misleading." That's me analyzing the situation based on the facts at hand. I would encourage you to do the same.
Best,
PSDFinancier